One change we have made to our budget process in the last 6 months is to add a line in the spreadsheet for “Large Appliance/Home Repair.” Our intention with this savings category is to surprise “Murphy” by being financially prepared when something breaks.
Can you beat Murphy all the time? No, but we did have a recent victory! Our dishwasher was becoming unreliable and reluctant to turn on. It was inconvenient, but not a crisis because we had built up funds for such an occurrence by saving $25.00-$50.00 a week when we could. We were able to pay in full for a new dishwasher and we still have several hundred dollars available. Now that we withdrew money from that budget line, we will put attention on replenishing it.
We also keep a spreadsheet listing our major appliances, the date purchased, and the date the warranty expires. The spreadsheet helps us be aware of any items that may be coming due for replacement. If your conventional water heater is 12 years old, you’re easy pickings for Murphy! When you have been a homeowner for a while it is so easy to think that you just replaced something, only to find that it’s 10 years old. Knowing a replacement is on the horizon gives us time to watch for sales or begin researching options.
*Part of Financially Savvy Saturdays on brokeGIRLrich, & A Disease Called Debt
So our budget is basically a joke. We don’t really check on it. But I do have a line item in there for home repairs and maintenance… In our 10 year marriage we have replaced 2 fridges and we’ve had some costly water heater repairs in the last year. We also had to have someone come out to ward off a mouse infestation and it’s nice to know that we do actually have money to spend on those things.
We think of this budget category as though we were paying condo fees… We have our own account for these medium size expenses, or even just a plumber visit. Otherwise we have to pay out of our weekly money or our emergency fund… And neither is ideal.
Great way to handle this! When we bought our current home, we knew that a couple of things were in the elderly category so we made sure we had money set aside. It made it a lot easier to fork over that money for a new furnace and a new AC unit! We did the same when we needed a new roof on our other house. The extra stress we avoided was worth it in the end. It’s not always possible to avoid the surprises, but a lot easier to deal with them when you have a cushion.
My mom always said that you never talked about having extra money in front of the appliances, she swore they had ears!
Yes, and never tell your washing machine and dryer that another appliance broke, or they just want to join the party!
Sometimes we lament all the issues you have to deal with as a homeowner, but then again, we look at what it would cost to rent something nice plus a likely 200./mo for parking, and you are looking at $20,000 a year!! We own our home outright, so staying is FAR more budget friendly even with taxes, insurance and such.
Still, if we keep saving I am going to be ready for a condo in Santa Fe some day!
I do my best to stay ahead of Murphy too by creating mini savings accounts in my budget for things like home repairs and car repairs. I save $200 a month for the house and $150 a month for the cars so whenever anything comes up I simply pay it. Earlier this month we had to replace some wood in our garage because of termites ($450) and we barely felt it because we had a nice cushion in our account for it.
I use the program YNAB (youneedabudget.com) and it’s totally changed the way I budget. It helps budget irregular expenses like these as well as things like taxes and Christmas that come once a year. I highly recommend you check it out!
Super smart! While we’re saving for a home, we are buffing up our emergency fund so that if this happens right off the bat we’ll be prepared.
Great idea. Our house is paid off, but we still have a perpetual stream of things due for replacement or attention. Thanks for visiting and I will stop by your blog today.
That’s a great idea! It’s amazing how quickly time passes and you don’t realize that your appliances are almost ready for replacement.
Thanks for visiting Tre! This year we have our eye on our air conditioner. It’s 15 years old… We hope to run it soon before it gets hot so we can see if it’s still running all right.
We have an all-emcompassing emergency fund and lately it’s been put to good use for car repairs. I have a couple of products where I need to register the warranty – should really do that before I forget! Great idea to keep track of your purchases like that as that way there will hopefully be no nasty surprises.
Thanks for stopping by Hayley. This spreadsheet should really help with planning expenditures down the road.
We used to have just one emergency fund, but we were reluctant to use it for things like a plumber visit. I guess we saw it as a “big emergency” kind of fund. We feel more at ease having something we can draw from for things $1000 and under.
That’s a really smart spreadsheet! I’ve just started saving up for a new computer and a new car. The new computer is on the horizon, but **knock on wood** the new car is several years out. Hopefully by starting to prepare now, I can keep ahead of Murphy whenever my computer and car decide to die.
Having an emergency fund is how to I try to stay ahead of Murphy. It will be even easier when I get my emergency fund fully funded for sure!